Mr. HOFFMAN. No, I have not been able to ascertain amount that has been received. Mr. BUCHANAN. I am not asking for the exact amount. Mr. BUCHANAN. The present value, warehouse receipts and cash, that has been collected up to the time when you make this report is how much? You have loaned out $55,000,000, I believe. Mr. HOFFMAN. We have collected on the principal up to November 30, approximately $30,000,000 of the $55,000,000. Mr. SANDLIN. That is figuring your warehouse receipts at the present price of commodities? Mr. HOFFMAN. Yes, sir. Mr. BUCHANAN. Is there any security for the balance? Mr. HOFFMAN. We have mortgages on this year's crop and also mortgages on livestock. Loans were made last fall and this spring in a total of $9,000,000 in the Northwest to feed livestock. Mr. BUCHANAN. Is that on this year's production crop loans? Mr. HOFFMAN. No, sir. Mr. BUCHANAN. That is out of the old appropriation? Mr. HOFFMAN. Yes, sir. Mr. BUCHANAN. Proceed. Mr. HOFFMAN. Those loans were on the farm foundation stock on which there is comparatively little chance to realize a repayment, except where there is some increase in the stock or where a farmer is able to pay something from his crop. Our collections have been further reduced because of the 75 per cent moratorium that was announced in the Northwest by the President. Mr. BUCHANAN. Did that moratorium apply to loans made out of the appropriation you have just described of $67,000,000? Mr. HOFFMAN. Yes, sir. Mr. BUCHANAN. As well as the crop production loans of this year? Mr. HOFFMAN. Yes, sir. Mr. BUCHANAN. Did you handle the crop production loans of this year? Mr. HOFFMAN. No, sir. Mr. BUCHANAN. You had nothing to do with that? Mr. HOFFMAN. No, sir; except I assisted in that work, because of my knowledge of the work of previous years. In connection with this collection, the same field inspectors have been collecting both moneys, the crop production loan money and the other money. COLLECTIONS, 1931 LOANS BY STATES AS OF JUNE 30, 1932 Mr. SANDLIN. Have you a list of the collections by States? Mr. SANDLIN. Out of the $67,000,000? Mr. HOFFMAN. Yes, sir; I have that right here. (The statement referred to is as follows:) Collection of 1931 loans, as of June 30, 1932-Acts of December 20, 1930, February 14, 1931, and February 23, 1931 1 Exclusive of collateral held valued at approximately $12,000,000 and $1,700,000 interest withheld from loans when made. Those figures that I gave you do not represent the interest that we have collected. In other words, we have collected approximately $1,900,000 of interest on the loans we made last year, which includes interest withheld and interest paid after maturity. Mr. BUCHANAN. This table that you have given us only covers your cash? Mr. HOFFMAN. Yes, sir. Mr. BUCHANAN. You have an item of interest here of $200,000 collected? Mr. HOFFMAN. Yes, sir; if you will look at the statement already inserted in the record, it gives the fact that interest was withheld and it also specifies the collateral. Mr. BUCHANAN. You have all the seed loan acts here from 1920 on up, have you not? Mr. HOFFMAN. Yes, sir. Our administrative expenses have been heavier, in view of the fact that the loan area last year was expanded; loans were made in 31 States, necessitating establishing five different offices throughout the country whereas heretofore where we made loans in a small area, we had only one office serving that area. Up to last year with one exception we never had over six States at one time and they were all handled from one office. When we started out in 1931 we had 31 States. PRESIDENT'S ORDER ON PAYMENT OF SEED LOANS Mr. SANDLIN. Have you a copy of the President's order granting moratoriums? Mr. HOFFMAN. Not with me. Mr. SANDLIN. Will you put it in the record? SEPTEMBER 29, 1932. (The following statement was given out at the White House to-day): Present low prices make it practically impossible for wheat farmers to repay their crop production loans without incurring grave risk of need during the winter. On September 14 the Secretary of Agriculture, in order to clear up the situation issued the following statement in respect to these loans: "With respect to your recommendation as to deferment of collection of feed and seed loans made by this department I am authorized by the President to say that the department wishes to handle the situation with the utmost consideration for the borrowers who are in difficulties. You will realize that the law contemplates that the loans must be repaid out of this crop and that to give such extension as you wish will require legislative authority. To meet the needs of those who are in distress the department will not press for collection of these loans until Congress has an opportunity to act.' It is now represented that this plan has not solved the difficulties in all localities as it has been construed that under this arrangement a claim remains upon the crop which prevents the marketing of any part of it. In order to clear the matter up, after consultation with authorities in the States concerned, and in order to enable such farmers to provide for their families, the Secretary of Agriculture, after consultation with the President, has directed the department to accept from such farmers 25 per cent of the amount due, together with an agreement to secure the remaining 75 per cent of such debt on whatever terms Congress may authorize. Upon payment of such 25 per cent and execution of the agreement, no further payment will be required until opportunity has been given Congress to pass on the question involved. TOTAL AMOUNT OF LOANS MADE AND PRINCIPAL AND INTEREST COL- Mr. BUCHANAN. The total loans made was $70,965,800.29. Mr. BUCHANAN. And you collected in cash of the amount loaned out, of the principal $27,010,478.80. Mr. HOFFMAN. Yes, sir. Mr. BUCHANAN. What do you mean here when you say interest collected on 38.1 per cent? Mr. HOFFMAN. That means the percentage collected of the amount loaned during those years. Mr. BUCHANAN. You mean you collected 38 per cent of the interest? Mr. HOFFMAN. Thirty-eight per cent has been collected on the principal of the amount loaned, in cash. Mr. JUMP. It is 55 per cent if you are going to consider estimated warehouse receipts. Mr. BUCHANAN. In another column here, you have amount of interest collected $591,000. Does that mean you have collected that much interest? Mr. HOFFMAN. Yes, sir. The figure $1,700,000 underneath that is interest withheld when we made the loans in 1931. We withheld the interest up to maturity date. Mr. BUCHANAN. Of the amount loaned out, $70,965,800.29, you have collected both in cash and are holding warehouse receipts to a total value of $39,185,715.71? Mr. HOFFMAN. Yes, sir. Mr. BUCHANAN. Making, according to these figures, 55.2 per cent of the amount loaned out. Mr. HOFFMAN. Yes. Mr. SANDLIN. That went back into the Treasury? Mr. HOFFMAN. That went back each fiscal year. Mr. BUCHANAN. Are you going to spend half a million dollars that we appropriated for you this year? Mr. HOFFMAN. We have spent already $321,000 of the $500,000 that was appropriated this year. You see, a large amount of that money was spent for recording fees, recording our mortgages. Mr. BUCHANAN. Taking new mortgages? Mr. HOFFMAN. Yes, sir. In some cases we have to pay as high as $2.50 for recording our mortgages. Mr. BUCHANAN. With reference to the amount of interest withheld from the loan, that means just a smaller amount that was loaned out, does it not? Mr. HOFFMAN. That was transferred from the several appropriations to miscellaneous receipts in the Treasury. Under the ruling of the Comptroller General, all interest either paid or withheld must be covered into the Treasury as miscellaneous receipts. Mr. BUCHANAN. So that $1,700,000, which represents that figure, merely means the amount available for loans was reduced by that much. Mr. HOFFMAN. Yes, sir. Mr. BUCHANAN. It could not be said to be interest collected, because it was never advanced. Mr. HOFFMAN. That is right. Mr. BUCHANAN. It was just deducted from the principal as advanced? Mr. HOFFMAN. Yes, sir. Mr. BUCHANAN. It decreased the amount available for loans by that much? Mr. HOFFMAN. Yes, sir. Mr. BUCHANAN. It is not a receipt. Mr. HOFFMAN. The Treasury carries it as a receipt, of course. Mr. BUCHANAN. I know, but it is only an appropriation that is not loaned. That is all it is. You loaned out nearly $71,000,000? Mr. HOFFMAN. Yes, sir. Mr. BUCHANAN. You collected a little over $39,000,000 in cash and warehouse receipts now held and you state here that the principal outstanding is $31,780,082.58? Mr. HOFFMAN. Yes, sir. 149139-32-62 ADMINISTRATION EXPENSES FOR COLLECTION OF SEED LOANS Included in the amount of money that we loaned was also approximately $1,500,000 that was loaned to individuals from the $20,000,000 appropriation to purchase capital stock of agricultural credit corporations. We had some expenditures and still have some expenditures from the $500,000 that was appropriated for this work in connection with the collection of those agricultural loans. Mr. BUCHANAN. That was over a million dollars? Mr. HOFFMAN. $1,453,023.94, to be exact. Mr. BUCHANAN. From the $20,000,000 that was authorized in the Interior Department bill? Mr. HOFFMAN. Yes, sir. Mr. BUCHANAN. And the money to administer that came out of the $500,000? Mr. HOFFMAN. Administrative expenses incident to the collection of these loans comes out of the $500,000, yes. Mr. BUCHANAN. Do you know how much that amounts to? Mr. BUCHANAN. Yes. Mr. HOFFMAN. There has not been so very much during this last fiscal year, starting July 1, 1932. The only expenses have been for some four or five people who are paid from the seed-loan pay roll. Last year, of course, there were some expenses. Committees were formed in each State to pass on applications and their traveling expenses were paid, stenographic help, etc. All of these expenses were paid from the $45,000,000 seed-loan appropriation, because the Comptroller General held that the $20,000,000 item was an amendment of the $45,000,000 act, and the expenses had to be paid from that item instead of being paid from the $20,000,000 appropriation. Mr. BUCHANAN. I am just wondering how the Comptroller General could rule to divert money appropriated for the purpose of seed loans to administer an act for the purpose of purchasing stock from agricultural credit corporations. Mr. HOFFMAN. The item in the Interior Department bill was an amendment to the $45,000,000 drought appropriation. Mr. BUCHANAN. I understand, but we appropriated $500,000 to take care of this work. You have no collections to do in connection with these agricultural credit corporations? Mr. HOFFMAN. I did not mean to convey the idea that the expenses of the agricultural credit corporations for the last fiscal year came out of the $500,000. They are coming out of it this year, though. Mr. BUCHANAN. You do not exactly understand the point I have in mind. We appropriated $500,000 for this fiscal year for the express purpose of collecting these loans. Mr. HOFFMAN. Yes, sir. Mr. BUCHANAN. Now, the Comptroller General holds that any administrative expenses in connection with the activities of the agricultural credit corporations come out of this fund. I am just wondering how he can hold that you may divert any portion of this $500,000 appropriation for administrative expenses here to pay the administrative expenses of the agricultural credit corporations. Mr. HOFFMAN. I imagine that he held that last year because there was no specific appropriation made for any expenses in connection with the making of agricultural credit corporations loans. |